Attachment 

1

ATTACHMENT TO ADC 274 

DLMS and DLSS Changes to Support Army Exchange Pricing 

1. ORIGINATOR: 

a. Service/Agency: Army Headquarters, United States Army Material Command 

b. Originator: Army, Logistics Modernization Program (LMP), commercial phone: 

856-988-4878 

2. FUNCTIONAL AREA: Supply/Finance 

3. REQUESTED CHANGE: 

a. Description of Change: Changes since PDC staffing are identified by yellow highlighting. 

(1) Exchange Pricing (EP) is a business process improvement mandated by the Office of the 

Secretary of Defense (Comptroller) (OSD (C)), to mitigate the financial problems the Army has 

experienced with granting excess credit through its current supply practices, and allows credit for 

reparable items to provide incentive for organizations to turn-in unserviceable component parts, that Army 

Materiel Command (AMC) repairs and returns to inventory to support unit readiness needs. In order to 

rectify this situation, the Army will convert to a dual pricing system. All items will have a Standard Price 

(SP), which represents the Latest Acquisition Cost, plus a recovery rate. Additionally, Army Managed 

National Stock Numbered (NSN) items that are on an existing or planned national repair program, will 

also have an Exchange Price (EP), which represents the Latest Repair Cost plus a recovery rate. 

Essentially, those nationally repaired items will be issued at a discounted price based upon an expected 

return. If EP items are not returned within the established timeline (Delta Delay Days), the process will 

generate a Delta Bill (SP minus EP), which would result in a net cost of the full Standard Price to the 

customer. The Exchange Price will only be applicable to Army EP customers. All other customers will 

be charged the Standard Price. Additionally, if a serviceable turn-in is made against an EP item, the 

customer will be credited with Serviceable Exchange Price Return (SEPR), which represents the 

Exchange Price minus the Cost Recovery Rate. The Army will update these data elements with the 

Federal Logistics Information System (FLIS). 

(2) There will be a conversion period that will last for 60 days following the Exchange Pricing 

implementation, which corresponds to the first Delta Delay period, to allow customers to be able to close 

open transactions initiated using the current business rules. 

(3) Although different terminology is used, this concept is similar to that used by both the Navy 

and Air Force for more than 10 years. However, there are significant enough differences, that the use of a 

standard process is not feasible. This change does not impact other Service procedures.

(a) The Air Force process is entirely contained within one system, and as such, requires no 

external transactions to perform this process. The Army process will utilize several systems that perform 

different functions and would require information to be exchanged between them. 
Attachment 

2

(b) In the Navy process, a Navy activity, which is requisitioning an item that is eligible for 

Carcass Tracking credit, enters their Carcass Tracking program, and the requisitioner indicates the type of 

credit expected and delays in turn-in timeframes. In the Army, only authorized Tactical Units are eligible 

for Exchange Pricing, the logic for which is in the Middleware Funds Control system, which needs to be 

communicated to the Logistics Modernization Program (LMP), Commodity Control Standard System 

(CCSS), and Defense and Finance Accounting Service (DFAS), and a turn-in is assumed unless otherwise 

indicated. Additionally, the Navy tracks reparable status by perpetuating document numbers. The Army 

process involves several systems that contain business rules to not allow duplication of document 

numbers, and as such the tracking is by material number and requisitioning activity. 

(4) The Army Exchange Pricing process is outlined below: 

(a) When an authorized EP customer sends in a requisition (DLMS transaction 511R, Defense 

Logistics Standard Systems (DLSS) transactions A0_, Army Transaction BE9) for an EP item, or 

performs other follow-on actions (DLMS transactions 511M, and 869F, DLSS transactions AM_ and 

AT_, respectively) for the same requisition, an Exchange Pricing Indicator is present on the transaction to 

indicate to the Inventory Control Point (ICP) that the requisition is Exchange Pricing relevant, and allow 

the systems to begin the EP tracking. The serviceable asset is released to the customer (DLMS transaction 

940R, DLSS transaction A5_) and is recorded in the Middleware Funds Control Tracking File. However, 

if the customer knows that there will be no turn-in made, it is identified by the lack of an EP indicator, and 

they will immediately be charged the Standard Price. 

(b) Any supply statuses (DLMS transaction 870S, DLSS transactions AE_) generated from the 

ICP for an EP requisition will have the EP indicator present, and perpetuated from the original requisition. 

(c) Any Material Release Order (DLMS transaction 940R, DLSS transaction A5_, Army 

Transaction B99) from the Retail Level for an EP requisition will have the EP indicator present, and 

perpetuated from the original requisition. The Material Release Order will start the Delta clock. For 

remote and dedicated customer issues from the National Level, the Delta clock will start on submission of 

the Shipment Status (DLMS transaction 856S, DLSS transaction AS_). The EP indicator will not be 

required on the Shipment Status, since the document number will be perpetuated from the Material 

Release Order. Initial billing (DLMS transaction 810L, DLSS transaction FA1) at the Exchange Price 

occurs concurrently with the Material Release Order, and is identified by a Type Bill Code (rp 60-61) of 

“EP” and the EP indicator. 

 (d) When the unserviceable asset is received (DLMS transaction 527R, DLSS transactions 

D6R, and DZK) by the ICP, the turn-in is validated against the Middleware Funds Control Tracking File 

to match a serviceable issue, and based on the condition of the material received, and the success or failure 

of the match, the type of credit that will be issued is indicated on the transaction. Additionally, these 

transactions are also used to record the receipt of a serviceable turn in, since SARSS generates the D6R 

transaction, while reconciling the status of any corresponding issues made is performed separately in the 

Middleware Funds Control Tracking File. The receipt transactions will also contain EP relevant 

indicators. The DZK is sent to reconcile historical records in the event that the original D6R is never 

received, and will also contain EP relevant indicators. Receipt of a serviceable asset, identified by the EP 

Indicator and a serviceable Condition Code, will result in the issue of a Credit Bill for Serviceable Credit 

(DLMS transaction 810L, DLSS transaction FA2 identified by a Type Bill Code (rp 60-61) of “SC” and 

the EP indicator. 
Attachment 

3

 (e) If the turn-in is not received within Delta Days or is in an unacceptable condition (e.g. 

Condition Code “H”), a delta bill will be generated. The Middleware Funds Control Tracking system 

will generate a Material Receipt Status (DLMS transaction 870M, DLSS transaction FTZ) transaction 

to either the Army’s Logistics Modernization Program (LMP) or Commodity Control Standard System 

(CCSS), indicating the amount of any billing differences that result from the status of the turn-in and 

triggering the issue of a delta bill. The 870M will contain EP relevant indicators. 

Staffing Note: The processes and procedures outlined in Approved DLMS Change 215 (Material 

Receipt Status (Material Returns Program (MRP)) Credit Reversal Amount) will remain in place, but 

only be utilized for non-EP Material Returns. Under Exchange Pricing, any credit to be granted would 

be on an exception basis and be triggered by manual intervention, rather than by the DLSS 

FTZ/DLMS 870M transaction as identified in paragraph (4)(d) above and (4)(f) below. 

(f) Billing and Credit. The Material Receipt Status transaction initiates the Delta Bill (DLMS 

transaction 810L, DLSS transaction FA1 with a Type Bill Code (rp 60-61) of “DB” and the EP indicator) 

to be sent to the customer. Arbitration between the customer and the Inventory Control Point can result in 

the Delta Bill reversal (DLMS transaction 810L, DLSS transaction FD1, identified by a Type Bill Code 

(rp 60-61) of “RB” and the EP indicator). The reversal process is manual, current as is process, not 

supported by any EP systems extensions. EP indicators are to be added manually. 

 (g) The transaction process flows are provided in Attachment 1 to illustrate the transaction 

flows between systems. Additionally, it is assumed that the customer and material are Exchange Pricing 

relevant by Funds Control Module Tracking. 

(5) The Army is utilizing Army-unique data elements to identify those transactions that are EP 

relevant: 

 (a) Establish a new data element titled Exchange Pricing Indicator (mapped to LQ01 = SEC) 

for use on 511M, 511R, 527R, 810L, 869F, 870M, 870S, and 940R DLMS transactions to identify that the 

Customer and NIIN are Exchange Pricing Relevant. The EP Indicator is to be located in the LQ/140 

segment of the 511M and 511R transaction, in the LQ/130 segment of the 527R transaction, in the LQ/310 

segment of the 810L transaction, in the LQ/180 segment of the 869F transaction, in the LQ/330 segment 

of the 870M transaction, in the LQ/135 segment of the 870S transaction, and in the LQ/1300 segment of 

the 940R transaction. These correspond to record positions (rps) 55-56 in all DLSS transactions with the 

exception of the DZK (D6R reconciliation), which corresponds to rps 78-79. The only allowed value is 

“EP” (Exchange Pricing Relevant). Additionally, the Exchange Pricing Indicator will also be located in 

the LQ/310 segment of the 810L and in the LQ/330 segment of the 870M DLMS transactions, even 

though there is no corresponding DLSS record position in order to maintain DLMS consistency 

throughout the process. 

(b) Establish a new data element titled Exchange Pricing Type of Credit Indicator (mapped to 

LQ01 = BCR) for use on the 527R DLMS transaction to identify the type of credit to be received by the 

customer. The EP Type of Credit Indicator is to be located in the LQ/130 segment. This corresponds to 

rps 60 – 61 multiuse field in the DLSS transaction D6R. The only allowed value is “UC” (Unserviceable 

Credit). Unless otherwise specified, Serviceable Credit will be granted based on the serviceable turn in of 

an EP item (identified by the combination of a serviceable condition code and the presence of the EP 

indicator), regardless of a matching issue being present or not. The only difference between these 
Attachment 

4

scenarios is that when an issue is made, there will be an initial billing document at the time of issue, 

followed by a SEPR credit; if there is no issue, the only document will be a SEPR credit. Following the 

conversion period, the Unserviceable Credit indicator will be discontinued, and only Serviceable Credit 

will be granted based on the EP Indicator. The Delta Bill extended value will be indicated on the DLMS 

870M/DLSS FTZ transaction as described above. 

 (c) Establish a new data element titled Exchange Pricing Conversion Indicator (mapped to 

LQ01 = TTL) for use on the 527R DLMS transaction to be used only during the 60 day period following 

the Army’s implementation of Exchange Pricing to indicate to the systems that they are to ignore 

Exchange Pricing rules. The EP Conversion Indicator is to be located in the LQ/130 segment. This 

corresponds to rp 63 – 65 multiuse field in the DLSS transaction D6R. The only allowable value for use 

during the conversion period is “CON”. The use of this qualifier will only be relevant during the 

conversion period and following that, will be discontinued. 

 (d) Authorize the use of Status Code (LQ01 = 81) value “EP” on 870M DLMS transaction to 

identify that the Customer and NIIN are Exchange Pricing Relevant. This corresponds to rp 65 – 66 of the 

DLSS transaction FTZ, and no change is required to the DLMS IC or DAASC Conversion Maps. 

 (e) Authorize the use of Type of Bill Code (LQ01 = 54) values “EP”, “DB”, “RB”, or “SC” as 

described below on 810L DLMS transaction to identify that the Customer and NIIN are Exchange Pricing 

Relevant. This corresponds to rp 60 – 61 of the DLSS transactions FA1, FA2, FD1 and FD2, and no 

change is required to the DLMS IC or DAASC Conversion Maps. 

 b. Procedures: 

(1) Revise DLMS Supplements and DAASC Mappings for 511M, 511R, 527R, 810L, 869F, 870M, 

870S and 940R as follows: 

Item # Location Revision to 

511M, Requisition Modification 

Reason 

1. DLMS 

Introductory 

Note: 

Added ADC 274 to DLMS Introductory note 5.

- ADC 274, DLMS and DLSS Changes to Support Army Exchange Pricing 

To identify DLMS 

changes included in the 

DS 

2. 2/LQ01/140 Added qualifier “SEC” with the following DLMS Note:

SEC Stock Exchange Code 

DLMS Note: Use to identify the Exchange Pricing Indicator for intra-Army 

transactions to identify that the Customer and NIIN on the transaction are Exchange 

Pricing relevant. An ANSI data maintenance request has been prepared to establish a 

new data element 1270 code qualifier assignment for Exchange Pricing Indicator. 

When applicable, cite code value EP (Exchange Pricing). Refer to ADC 274.

Needed to support 

Army’s Exchange 

Pricing program. 

DLSS/DLMS Mapping 

Field Name DLSS Position Conditions Revision to 511M Mapping 511M 

Position/Loop 

Exchange Pricing Indicator 55 - 56 If rp 30 = W AND 

If rp 55-56 = EP 

LQ01 = SEC 

LQ02 = rp 55-56 

2/LQ/140 

Item # Location Revision to 

511R, Requisition 

Reason 

1. DLMS 

Introductory 

Added ADC 274 to DLMS Introductory note 5. To identify 

DLMS changes 
Attachment 

5

Note: - ADC 274, DLMS and DLSS Changes to Support Army Exchange Pricing included in the 

DS 

2. 2/LQ01/140 Added qualifier “SEC” with the following DLMS Note:

SEC Stock Exchange Code 

DLMS Note: Use to identify the Exchange Pricing Indicator for intra-Army transactions to 

identify that the Customer and NIIN on the transaction are Exchange Pricing relevant. An 

ANSI data maintenance request has been prepared to establish a new data element 1270 code 

qualifier assignment for Exchange Pricing Indicator. When applicable, cite code value EP 

(Exchange Pricing). Refer to ADC 274.

Needed to 

support Army’s 

Exchange 

Pricing program. 

DLSS/DLMS Mapping 

Field Name DLSS Position Conditions Revision to 511R Mapping 511R 

Position/Loop 

Exchange Pricing Indicator 55 - 56 If rp 30 = W AND 

If rp 55-56 = EP 

LQ01 = SEC 

LQ02 = rp 55-56 

2/LQ/140 

Item # Location Revision to 

527R, Material Receipt 

Reason 

1. DLMS 

Introductory 

Note: 

Added ADC 274 to DLMS Introductory note 7.

-ADC 274, DLMS and DLSS Changes to Support Army Exchange Pricing 

To identify DLMS 

changes included in 

the DS 

2. 2/LIN01/010 Revise LIN01 DLMS note18:

 

18. R – Exchange Item. Return Exchange of Service/Agency designated item to 

inventory, when a like item is issued on an exchange basis. Applicable only to 

nonprocurement source transactions. (DI Code D6R functionality)

MILSTRAP 

Administrator update 

to revise note to more 

closely reflect 

MILSTRAP DI Code 

D6R definition from 

which the definition 

for LQ01 Code R 

was derived. The 

MILSTRAP 

Administrator shall 

update other LQ01 

codes by a separate 

DLMS change to 

show corresponding 

MILSTRAP DI 

Code. 

3. 2/LQ01/130 Added qualifier “SEC” with the following DLMS Note:

SEC Stock Exchange Code 

DLMS Note: Use to identify the Exchange Pricing Indicator for intra-Army 

nonprocurement source receipt and historical receipt transactions, to identify that the 

Customer and NIIN on the transaction are Exchange Pricing relevant. Use with LIN01 

code R (exchange item). An ANSI data maintenance request has been prepared to 

establish a new data element 1270 code qualifier assignment for Exchange Pricing 

Indicator. When applicable, cite code value EP (Exchange Pricing). Refer to ADC 274. 

Needed to support 

Army’s Exchange 

Pricing program. 
Attachment 

6

Item # Location Revision to 

527R, Material Receipt 

Reason 

4. 2/LQ01/130 Added qualifier “BCR” with the following DLMS Note:

BCR Business Credit Rating 

DLMS Note: For temporary use to identify the Exchange Pricing Type of Credit for 

intra-Army receipt transactions to identify that Exchange Pricing unserviceable 

condition credit is to be received by the customer. The Exchange Pricing Type of Credit 

is used only during the 60 day conversion period following the Army’s implementation of 

Exchange Pricing (estimated to be implemented May 1, 2009). When applicable, cite 

code value UC (Unserviceable Credit). This code is temporary and will be removed from 

the LQ segment after the conversion period. Refer to ADC 274. 

Needed to support 

Army’s Exchange 

Pricing program. 

This code is 

temporary and will 

be removed 

subsequent to the 

conversion period. 

No X12 1270 code 

data maintenance 

request required. 

5. 2/LQ01/130 Added temporary qualifier “TTL” with the following DLMS Note:

TTL Template Type Lookup 

 

DLMS Note: For temporary use in intra-Army receipt transactions to identify the 

Exchange Pricing Conversion Indicator only during the 60 day conversion period 

following the Army’s implementation of Exchange Pricing (estimated to be implemented 

May 1, 2009) to indicate to the systems that they are to ignore Exchange Pricing rules. 

When applicable, cite code value CON (Conversion Period). This code is temporary and 

will be removed from the LQ segment after the conversion period. Refer to ADC 274. 

Needed to support 

Army’s Exchange 

Pricing program. 

This code is 

temporary and will 

be removed 

subsequent to the 

conversion period. 

No X12 1270 code 

data maintenance 

request required. 

DLSS/DLMS Mapping 

Field Name DLSS Position Conditions Revision to 527R Mapping 527R 

Position/Loop 

Exchange Pricing Indicator 55 – 56 

78 - 79 

If rp 30 = W AND 

((If rp 1-3 = D6R AND If rp 

55-56 = EP) OR 

(If rp 1-3 = DZK AND If rp 54-

56 = D6R AND If rp 78-79 = 

EP)) 

LQ01 = SEC 

LQ02 = rp 55-56 (EP) 

LQ01 = SEC 

LQ02 = rp 78-79 (EP) 

2/LQ/130 

Exchange Pricing Type of 

Credit Indicator 

60 - 61 (If rp 1-3 = D6R OR 

(If rp 1-3 = DZK AND If rp 54-

56 = D6R)) AND 

If rp 30 = W AND 

If rp 60-61 = UC 

LQ01 = BCR 

LQ02 = rp 60-61 

2/LQ/130 

Exchange Pricing 

Conversion Indicator 

63 - 65 (If rp 1-3 = D6R OR 

(If rp 1-3 = DZK AND If rp 54-

56 = D6R)) AND 

If rp 30 = W AND 

If rp 63-65 = CON 

LQ01 = TTL

LQ02 = rp 63-65 

2/LQ/130 

Item # Location Revision to 

810L, Logistics Bill 

Reason 

3. DLMS 

Introductory 

Note: 

Added ADC 274 to DLMS Introductory note 8.

- ADC 274, DLMS and DLSS Changes to Support Army Exchange Pricing 

To identify 

DLMS changes 

included in the 

DS 

4. 2/LQ01/310 Added qualifier “SEC” with the following DLMS Note:

SEC Stock Exchange Code 

DLMS Note: Use to identify the Exchange Pricing Indicator for intra-Army transactions to 

identify that the Customer and NIIN on the transaction are Exchange Pricing relevant. An 

ANSI data maintenance request has been prepared to establish a new data element 1270 code 

qualifier assignment for Exchange Pricing Indicator. When applicable, cite code value EP 

(Exchange Pricing). Refer to ADC 274.

Needed to 

support Army’s 

Exchange 

Pricing program. 
Attachment 

7

DLSS/DLMS Mapping 

Field Name DLSS Position Conditions Revision to 810L Mapping 810L 

Position/Loop 

Exchange Pricing Indicator None If rp 1-3 = FA1, FA2, FD1 or 

FD2 AND 

If rp 30 = W AND 

If rp 60-61 = DB, EP, RB, or 

SC 

LQ01 = SEC 

LQ02 = EP 

2/LQ/310 

Item # Location Revision to 

869F, Requisition Follow-up 

Reason 

1. DLMS 

Introductory 

Note: 

Added ADC 274 to DLMS Introductory note 5.

- ADC 274, DLMS and DLSS Changes to Support Army Exchange Pricing 

To identify 

DLMS changes 

included in the 

DS 

2. 2/LQ01/180 Added qualifier “SEC” with the following DLMS Note:

SEC Stock Exchange Code 

DLMS Note: Use to identify the Exchange Pricing Indicator for intra-Army transactions to 

identify that the Customer and NIIN on the transaction are Exchange Pricing relevant. An 

ANSI data maintenance request has been prepared to establish a new data element 1270 code 

qualifier assignment for Exchange Pricing Indicator. When applicable, cite code value EP 

(Exchange Pricing). Refer to ADC 274.

Needed to 

support Army’s 

Exchange 

Pricing program. 

DLSS/DLMS Mapping 

Field Name DLSS Position Conditions Revision to 869F Mapping 869F 

Position/Loop 

Exchange Pricing Indicator 55 – 56 If rp 30 = W AND 

If rp 55-56 = EP 

LQ01 = SEC 

LQ02 = rp 55-56 

2/LQ/180 

Item # Location Revision to 

870M, Material Returns Supply Status 

Reason 

1. DLMS 

Introductory 

Note: 

Added ADC 274 to DLMS Introductory note 6.

- ADC 274,DLMS and DLSS Changes to Support Army Exchange Pricing 

To identify 

DLMS changes 

included in DS 

2. 2/LQ01/330 Added qualifier “SEC” with the following DLMS Note:

SEC Stock Exchange Code 

DLMS Note: Use to identify the Exchange Pricing Indicator for intra-Army transactions to 

identify that the Customer and NIIN on the transaction are Exchange Pricing relevant. An 

ANSI data maintenance request has been prepared to establish a new data element 1270 code 

qualifier assignment for Exchange Pricing Indicator. When applicable, cite code value EP 

(Exchange Pricing). Refer to ADC 274.

Needed to 

support Army’s 

Exchange 

Pricing program. 

DLSS/DLMS Mapping 

Field Name DLSS Position Conditions Revision to 870M Mapping 870M 

Position/Loop 

Status Code 65 - 66 None LQ01 = 81 

LQ02 = rp 65-66 

2/LQ/330 

Exchange Pricing Indicator None In addition to above, if rp 1-3 = 

FTZ AND 

If rp 30 = W AND 

If rp 65-66 = EP 

LQ01 = SEC 

LQ02 = rp 65-66 (EP) 

2/LQ/330 
Attachment 

8

Item # Location Revision to 

870S, Supply Status 

Reason 

1. DLMS 

Introductory 

Note: 

Added ADC 274 to DLMS Introductory note 4.

-ADC 274, DLMS and DLSS Changes to Support Army Exchange Pricing 

To identify 

DLMS changes 

included in the 

DS 

2. 2/LQ01/145 Added qualifier “SEC” with the following DLMS Note:

SEC Stock Exchange Code 

DLMS Note: Use to identify the Exchange Pricing Indicator for intra-Army transactions to 

identify that the Customer and NIIN on the transaction are Exchange Pricing relevant. An 

ANSI data maintenance request has been prepared to establish a new data element 1270 code 

qualifier assignment for Exchange Pricing Indicator. When applicable, cite code value EP 

(Exchange Pricing). Refer to ADC 274.

Needed to 

support Army’s 

Exchange 

Pricing program. 

DLSS/DLMS Mapping 

Field Name DLSS Position Conditions Revision to 870S Mapping 870S 

Position/Loop 

Exchange Pricing Indicator 55 - 56 If rp 30 = W AND 

If rp 55-56 = EP 

LQ01 = SEC 

LQ02 = rp 55-56 

2/LQ/145 

Item # Location Revision to 

940R, Material Release 

Reason 

1. DLMS 

Introductory 

Note: 

Added ADC 274 to DLMS Introductory note 6.

- ADC 274, DLMS and DLSS Changes to Support Army Exchange Pricing 

To identify 

DLMS changes 

included in the 

DS 

2. 2/LQ01/1300 Added qualifier “SEC” with the following DLMS Note:

SEC Stock Exchange Code 

DLMS Note: Use to identify the Exchange Pricing Indicator for Army transactions to identify 

that the Customer and NIIN on the transaction are Exchange Pricing relevant. An ANSI data 

maintenance request has been prepared to establish a new data element 1270 code qualifier 

assignment for Exchange Pricing Indicator. Non-Army Storage Locations are to perpetuate 

this vale on all subsequent transactions. When applicable, cite code value EP (Exchange 

Pricing). Refer to ADC 274.

Needed to 

support Army’s 

Exchange 

Pricing program. 

DLSS/DLMS Mapping 

Field Name DLSS Position Conditions Revision to 940R Mapping 940R 

Position/Loop 

Exchange Pricing Indicator 55 - 56 If rp 30 = W AND 

If rp 55-56 = EP 

LQ01 = SEC 

LQ02 = rp 55-56 

2/LQ/1300 

(2) Revise DLMS and MILS manuals to include a summary overview of Army exchange 

pricing process as shown below: 

(a) DoD 4000.25-1-M, Military Standard Requisitioning and Issue Procedures 

(MILSTRIP), Chapter 3, Requisition Processing and Related Actions. 

 (b) DoD 4000.25-1-M, Military Standard Transaction Reporting and Accountability 

Procedures (MILSTRAP), Chapter 4, Receipt and Due In. 
Attachment 

9

(c) DoD 4000.25-7-M, Military Standard Billing System (MILSBILLS), Chapter 2, new 

paragraph 11. 

(d) DOD 4000.25-M, Defense Logistics Management System (DLMS) Vol 2 and Vol 5. 

C#.## ARMY EXCHANGE PRICING PROCESS 

C#.##.#. The Army approach to the Exchange Pricing (EP) interim approach is a multi system 

functionality implementation. EP employs a dual pricing system for repairable National Stock 

Numbered items based upon Standard Price (latest acquisition cost plus cost recovery rate) and 

Exchange Price (latest repair cost plus cost recovery rate) and a “buy one – return one” relationship 

with the customer. That is, a qualified exchange pricing customer buys at the Exchange Price and 

pays a penalty if a reparable is not turned-in within a specified period of time from the issue date. 

This process is applicable to the Army customers and Army-managed material only; other Services 

will continue to pay Standard Price and receive 65% credit exchange upon receipt of carcass by the 

Army PICA 

C#.##.#. Once an item of supply is identified for a national repair program and the National 

Item Identification Number (NIIN) has an established Exchange Price, all requisitions for the item will 

be priced at the Exchange Price if the customer is an authorized EP customer. 

C#.##.#. When a requisition submitted to the Supply Support Activity (SSA) is processed by 

the Standard Army Retail Supply System (SARSS), SARSS will determine if both the customer 

DODAAC is an EP customer, and the NIIN has an established Exchange Price. If the customer is an 

EP customer the requisition will be updated to include the EP Indicator. As this transaction is 

processed through the Army supply system, middleware, Funds Control Module (including EP 

Tracking) Defense Automated Address System (DAAS), Commodity Control Supply System (CCSS), 

and Army Logistics Modernization Program (LMP), the EP Indicator will be used to identify the 

transaction as EP related. All the legacy systems will continue processing the MILS transactions, 

LMP will process Defense Logistics Management Standards (DLMS) transactions that are converted 

by DAASC. 

C.#.##.#. All related supply transactions prepared by the Army will carry and perpetuate the 

EP Indicator. As a result of the EP implementation the following transactions will be impacted, 

Requisition, Requisition Modifier, Requisition Follow-Up, Material Release Order and Supply Status. 

The returns process will also process EP related transactions. The Material Receipt transaction will be 

generated by SARSS for all returns of EP NIINs, and will include an EP Type of Credit indicator for 

Unserviceable credit when applicable, as well as an EP Conversion Indicator to identify the need to 

provide credit according the pre-EP credit policy, which will last for 60 days following the 

implementation of Exchange Pricing. 

C.#.##.#. If the return is in an un-repairable condition code or the item is not returned within 

the established timeframe (Delta Delay Days), the National Level systems (LMP, CCSS) will create 

an obligation adjustment based on the receipt from Middleware Funds Control Module of a Material 

Returns Supply Status (Delta Bill Trigger) transaction. As a result of processing the delta bill trigger 

the national systems will create the logistics/interfund bill transaction with an EP Indicator and Type 

Bill code to identify the specific type of Exchange Pricing bill to the Army financial systems. 
Attachment 

10

(3) Revise DoD 4000.25-1-M Military Standard Requisitioning and Issue Procedures 

(MILSTRIP), Appendix 2.16, Status Codes, and corresponding DLMS dictionary data element. 

Staffing note: A Status Code EP is being established because the MILS format for the Material 

Returns Supply Status does not have the record positions available for inclusion of the EP Indicator, 

unlike the other MILS formats used in this process. Although this results in a redundancy in the 

DLMS format (which has both the Status Code EP and the EP Indicator) the application of the EP 

Indicator data element will be consistent across transactions and perhaps, in a full DLMS environment, 

other status codes may be furnished with the EP Indicator. 

Customer Asset Reporting Transaction Status Codes 

Code Explanation

EP Customer DoDAAC and reparable item being returned or item being issued are 

Army Exchange Pricing relevant and no unserviceable return has been received 

associated with an issue. The specified monetary amount shows any billing 

differences that result from the status of the turn-in i.e., delta amount (Standard 

Price minus Exchange Price). This status code is authorized for intra-Army use 

only in the DLSS transaction FTZ/DLMS Transaction 870M.

(4) Revise DoD 4000.25-7-M Military Standard Billing System (MILSBILLS) Manual, 

Appendix 2.5, Type of Bill Code, and corresponding DLMS dictionary data element. 

Code Description

EP Bill at Exchange Price 

DB Bill for the Delta amount (Standard Price minus Exchange Price) 

RB Credit Bill to reverse a Delta Bill (DB) under Exchange Pricing 

SC Credit Bill for Serviceable Credit under Exchange Pricing 

 (5) Enclosure 1 provides illustrative examples.

 (6) Enclosure 2 provides internal Army business rules, included here to facilitate better 

understanding of the Army process. This attachment is subject to change and is not a part of the 

formal DLMS/MILS documentation.

c. Alternatives: Prior to staffing this PDC 269, there were two joint Component/OSD meetings 

to discuss the exchange pricing methodology proposed by the Army and seek potential areas of 

commonality between the Components for standardization of business rules. The consensus of the 

September 7, 2007, meeting was that there was not sufficient support at either the Component or OSD 

level for pursuing inter-Service standardization of EP information exchange requirements at this time. 

Without a business case analysis, it was not possible to determine whether the cost/return on 

investment would outweigh the benefits of standardization and interoperability given the Services 

unique business practices and supporting infrastructure. Due to the Army’s pressing timeline for 

implementation, it was not deemed appropriate to cause a significant delay by pursuing coordinated 
Attachment 

11

joint procedures. DLMSO did identify several areas for consideration of alternative procedures to 

which the Army has responded below: 

 (1) DLMSO recommended the use of the Condition Code to determine the type of credit (for 

both conversion period and long-term), thereby eliminating the need for the Exchange Pricing Type of 

Credit Indicator. The Army has asked that this data element be retained for the conversion period: 

Revised Army Response: During the conversion period, an Unserviceable turn-in could be matched 

against an issue that occurred prior to the EP implementation date, an issue after the EP 

implementation date, or no issue at all. If the turn-in is matched against an issue that occurred prior to 

the EP implementation date or is not matched against an issue, Unserviceable Credit would be granted. 

If the turn-in is matched against an issue after the EP implementation date, no Unserviceable Credit 

would be granted, because all transactions originating after the EP implementation date are subject to 

all EP business rules. However, the condition code would be used to identify Serviceable Credit, 

which would be utilized both during and after the conversion period. 

 (2) DLMSO recommended an alternate solution whereby the EP indicator could be multipurpose, thereby having only one new data element with multiple codes to identify conversion period 

vs. long term and/or serviceable vs. unserviceable. The Army has asked that the two additional data 

elements be provided during the conversion period: 

Army Response: This approach was rejected by the Army due to the risk to the existing schedule that 

would result from reconfiguring development that has already been completed in many of the interfacing 

systems. As communicated previously, the Army is under a very tight schedule in order to meet HQDA 

and OSD-C requirements, and any additional delay in the implementation would be unacceptable. 

4. REASON FOR CHANGE: Documents and incorporates DLSS and DLMS requirements for 

intra-Army data elements to support the Army’s implementation of Exchange Pricing in order to 

comply with OSD(C) guidance.

5. ADVANTAGES AND DISADVANTAGES: 

a. Advantages: Supports Army implementation of DLMS migration effort to accurately track 

reparable items and grant the appropriate credit when Army organizations turn-in unserviceable 

component parts that Army Materiel Command (AMC) repairs and returns to inventory to support unit 

readiness needs. The OSD(C)) mandated the date for Army Exchange Pricing functionality to be 

April 2008; however Army anticipates a release at that time which will only provide partial 

functionality without improving the financial process and posture. Based on current planned 

functionality utilizing the processes defined by this PDC, Army is expected to deliver full functionality 

one year later, in April 2009. Any change to current design and development will incur additional 

requirements development time, contract modifications and additional funding, which would not be 

acceptable to OSD. Finally, the Exchange Pricing effort has been underway in the Army for over five 

years, and considerable funding has been expensed to develop the current design. 

b. Disadvantages: The transactions proposed by the Army are different than those utilized by 

the other Services, but due to the differences in the processes performed by each, unique transactions 

are necessary. 

6. IMPACT: Modify DLMS Supplement 511M, 511R, 527R, 810L, 869F, 870S, and 940R and 

related DAASC conversion maps and modify DoD 4000.25-1-M, Appendix 2.16, Status Codes and 

DoD 4000.25-7-M, Appendix 2.5 Type of Bill Codes.
1 Enclosure 1 to ADC 274 Attachment 

Enclosure 1: Illustrative Examples 

Example 1: EP Customer Requisitions EP Item 

1. Unit prepares requisition in SARSS and Requisition is sent to Inventory Control Point. 

a. If the Issue is satisfied from the SARSS Supply Support Activity, the Requisition will 

be a post-post (511R/A0_with IV Edit Action Code, EP Indicator). Steps 3 and 4 are 

omitted and the Delta Clock begins upon issue. 

b. If the Issue is satisfied from the National Level (LMP/CCSS), the Requisition will be a 

working requisition (511R/A0_with EP Indicator). 

c. If the Issue is partially satisfied from the SARRS SSA and partially from the National 

Level, both an image (511R/A0_with DM Edit Action Code, EP Indicator) and working 

requisition (511R/A0_with EP Indicator) will be utilized. 

2. Supply Status, Requisition Follow-Ups and Modifications processed by Customer and/or 

Inventory Control Point as required (511M/AM_, 869F/AT_, 870S/AE_ with EP Indicator) 

3. Material Release Order (940R/A5_with EP Indicator) is generated by Inventory Control Point 

to the Storage Location to release the asset to the customer. The Delta Clock starts at this point 

if the issue is from the SARSS SSA. 

4. Inventory Control Point generates Delta Bill (810L/FA1 with EP Indicator and Bill Type Code 

“EP”) to Customer indicating the billing 

5. Shipment Status (856S/AS_) is sent by the Storage Location to the Customer. The Delta Clock 

starts at this point if the issue is from the National Level. 

EP Customer 

requisitions an EP 

Item 

SARSS DAASC 

LMP 

DSS 

CCSS 

DAASC

SARSS DAASC

A0_ 

A0

511R

A5_ 856S 

FA1

AS_ 

A5_ 

FA1

940R 

810L 

940R 

AM_ 

AT_ 

AM_ 

AT_ 

511M 

869F 

AE_ 

870S 

AE_ 
2 Enclosure 1 to ADC 274 Attachment 

Example 2: EP Customer Turn-In of EP Item 

1. The Customer returns the asset to the SARSS SSA, and is recorded by a Material Receipt 

registered in SARSS Middleware Funds Tracking, which passes the Material Receipt 

(527R/D6R with EP Indicator) information to the National Level (LMP/CCSS) 

a. If the Turn-in is Unserviceable and a corresponding Issue was made, the Delta Clock 

stops, and no further billing transactions occur. 

b. If the turn-in is a Serviceable asset, SEPR credit is generated as depicted in Example 3, 

3 below) 

c. If the turn-in is an Unserviceable asset with no corresponding Issue, Unserviceable 

Credit will be granted only during the conversion period (527R/D6R with EP Credit 

Indicator of “UC” and EP Conversion Indicator of “CON”). 

2. SARSS will send a Transaction History Transmittal (527R/DZK with EP Indicators) daily to 

the National Level to reconcile historical records in the event that the original D6R is never 

received. 

EP Customer turns 

in an EP Item SARSS DAASC

LMP 

CCSS 

D6R 

DZK 

D6R 

DZK 

527R 
3 Enclosure 1 to ADC 274 Attachment 

Example 3: EP Billing Triggers/Credit Actions 

1. If 60 days pass from the Material Release Order generation and either no turn-in is received, or 

the turn-in was not acceptable (i.e. Scrap condition) by the SARSS SSA, SARRS Middleware 

Funds Tracking submits Material Returns Receipt Status (870M/FTZ with EP Indicator and 

Status of “EP”) to Inventory Control Point to generate billing indicating the Delta amount. 

a. Based on this trigger, the Inventory Control Point generates a Delta Bill (810L/FA2 

with EP Indicator and Bill Type Code “DB”) to Customer indicating the billing for the 

amount in the Material Returns Receipt Status 

2. If the turn in was Unserviceable without corresponding issue (Example 2, 1c above), credit will 

be granted following current procedures. As noted above, this is only applicable during the 

conversion period. 

3. If the turn in was Serviceable (Example 2, 1b above), SEPR Price credit is granted (810L/FA2 

with EP Indicator and Bill Type Code “SC”). 

4. If, due to arbitration between the Customer and the Inventory Control Point, the Delta Bill 

previously charged may be reversed (810L/FD1 with EP Indicator and Bill Type Code “RB”). 

EP Billing Trigger 

SARSS DAASC

LMP 

CCSS 

DAASC SARSS

FTZ 

870M 

FA2 

FD1 

810L

FTZ 

FA2 

FD1 
Enclosure 2 - Army Exchange Pricing Business Rules 

1 Enclosure 2 to ADC 274 Attachment 

1/28/2008 10:00 AM 

Exchange Pricing (EP)Terms and Business Rules 

 (Baseline 1 February 2008) 

Standard Price (SP) = Latest Acquisition Cost (LAC) plus Cost Recovery Rate (CRR)

Serviceable Credit Value (SCV) = The dollar value shown in FEDLOG for serviceable credit.

Unserviceable Credit Value (UCV) = The dollar value shown in FEDLOG for unserviceable credit.

Loaded Repair Cost = (Average Repair Cost multiplied by Final Recovery Rate Percentage) plus 

[Latest Acquisition Cost multiplied by (1 minus Final Recovery Rate Percentage)]

Cost Recovery Rate = The first 9 Cost Recovery Elements (CRE) identified in paragraph 55.I.2.b, V 

11-B, DOD 7000.14-R (FMR). NOTE: CRE 10 (Retail Losses) discontinued. If the 9th CRE element 

(Carcass Attrition (Washouts & Losses) IS NOT included in CRE, add this attribute to the EP formula.

Exchange Price (EP) = Loaded Repair Cost (LRC) plus Cost Recovery Rate (CRR)

EP Item = An Army managed National Stock Number with a Maintenance Repair Code (MRC) of F, H, 

D, K, and L that is on an existing or planned national repair program that will have an exchange price as 

well as a standard price.

Army EP Customer = Customers designated by HQDA to pay the exchange price for EP items. 

Non Army EP Customer = Customers designated by HQDA to pay the standard price for EP items. 

Delay Days Period (DDP) = Parameter specified period of time allotted that an issue is available to be 

matched to a turn-in (initial parameter set at 60 days).

Delta Bill = an additional obligation to an EP customer as a result of an issue of an EP item in Tracking 

exceeding the DDP without a matching turn-in or matching an issue against a condemned turn in; based 

on standard price minus exchange price.

Serviceable Exchange Price Return (SEPR) = Exchange Price minus Cost Recovery Rate

Tracking = EP relevant transactions resident in EP Tracking that have not exceeded DDP. Transactions 

in tracking have the potential to be matched. 

History = Repository for all transactions once they are closed in Tracking. Transactions in history can 

no longer be matched.

Phase I: Stand-alone Tracking (SAT)

EPIP Description 

I EPBR 1 

The process will have the stand-alone ability to track issues and turn-ins 

of all EP stock numbers for both Army EP customers and Army 

customers who are not EP players. 

I EPIP 1.1 

The process will have the capability to turn on/off financial output 

transactions for all Army EP and non-EP customers (SEPR Credit, Delta 

Bill, and Unserviceable Credit triggers).

I EPBR 2 

Army managed National Stock Numbers with a Maintenance Repair 

Code (MRC) of F, H, D, K, and L that are on an existing or planned 

national repair program will have an Exchange Price (EP) in addition to 

Standard Price (SP); all others will have only SP. 

I EPIP 2.1 

Delta Delay period of time will be established by HQDA for theater or other 

area of operations down to a supporting Supply Support Activity (SSA) 

level. 

I EPIP 2.2

Army EP customers submitting requests for an EP item, where it is known 

that no unserviceable turn-in will be made, will be charged Standard Price on 

the issue (MRO). The MRO will post in tracking as a closed record and the 

Delta Delay clock will not start.
Enclosure 2 - Army Exchange Pricing Business Rules 

2 Enclosure 2 to ADC 274 Attachment 

Phase I: Stand-alone Tracking (SAT)

EPIP Description 

I EPBR 3 

Processes will be developed to track EP transactions based on 

established Business Rules. Tracking will initially be accomplished for 

SARSS supported customers. EP tracking ultimately will migrate to 

enterprise systems GCSS-Army and LMP. 

I EPIP 3.1 The process will identify by customer DoDAAC and prime stock number for 

all lines with an EP value assigned, and will capture all required transactions. 

I EPIP 3.2 

EP and SP rolled up to Prime Stock Number using the FEDLOG Order of 

Use (OOU) File. Local SNRF (SARSS YBH Table) will not impact EP/SP 

automation logic.

I EPIP 3.3 

When an Army EP customer receives a valid substitute stock number 

(designated by an AE_ status BH), which is an EP item, but not in the 

FEDLOG Order-of –Use (OOU) file, tracking will establish a 

prime/sub relationship on the issue in order to match a subsequent 

turn-in from the original stock number.

I EPIP 3.4 The process matches a customer issue to a customer return and a customer 

return to a customer issue, and monitors Delta Delay days. 

I EPIP 3.5 

The start point for tracking expected returns for customer issues will be 

scenario driven. For customer issues from a supporting SSA that do not have 

a matching turn-in, the clock will start on the date issue is made (SSA 

Materiel Release Order (MRO) date). 

I EPIP 3.6 When a customer turn-in matches an issue within prescribed Delta Delay 

days, the tracking process is complete. 

I EPIP 3.7 

The clock will start for a dedicated customer issue from other than the 

SARSS supporting activity on the shipment confirmation (AS_) and restart 

on the receipt (D6_) transaction date. 

I EPIP 3.8 

The process matches a customer issue against the (in order): 

a. oldest inactive reparable turn-in; 

b. oldest inactive condemned turn-in; 

c. oldest active reparable turn-in; 

d. oldest active condemned turn-in. 

If no match, the process creates a new record in tracking and starts the Delta 

Delay clock. 

I EPIP 3.9 The process will take into account process reversals (i.e. denials), and 

transactions that post out of sequence. 

I EPIP 3.10 The process will purge an unserviceable EP turn-in transaction from tracking 

if there is no matching issue transaction within 365 days. 

I EPBR 4 

The Logistics Information Warehouse (LIW) will capture data from 

SARSS supply system of record via FCM for management reports for 

the customer, materiel managers, and financial managers. 

I EPIP 4.1 The LIW is the reporting activity for tracking information.

Phase II: One-for-one Credit

EPBRs & EPIPs Description 

II EPBR 1 The Exchange Price equals Loaded Repair Cost plus cost Recovery 

Rate. 
Enclosure 2 - Army Exchange Pricing Business Rules 

3 Enclosure 2 to ADC 274 Attachment 

Phase I: Stand-alone Tracking (SAT)

EPIP Description 

II EPIP 1.1 

AMC LCMC publishes and provides to LOGSA for broadcast the Army 

Credit Table data elements (i.e. Standard Price, Exchange Price, Serviceable 

Credit, Unserviceable Credit (for Non-Army Customers), Serviceable 

Exchange Price Return, and Delta) before the beginning of each fiscal year. 

With the exception of DA authorized adjustments, these numbers shall 

remain constant throughout the year of execution. 

II EPIP 1.2 LOGSA will create new data fields in the Army Credit Table in coordination 

with AMC based on III EPIP 1.1. 

II EPBR 2 

The One-for-one Credit process will allow serviceable or unserviceable 

credit for Army SARSS customers only when a turn-in is matched 

against an issue within a parameter, DDP (initial parameter set at 60 

days) 

II EPIP 2.1 One-for-one Credit policy will apply to Army SARSS customers as 

designated by HQDA. 

II EPIP 2.2 One-for-one Credit policy applies only to EP NIINs. 

II EPIP 2.3 

Under One-for-one Credit, credit originally granted may be reversed for an 

unmatched turn-in of an EP item if not matched against an issue within the 

DDP. 

II EPIP 2.4 

The process attempts to match a customer turn-in against the oldest Issue. If 

a match and: 

1. Turn-in is serviceable, close both issue and turn-in transaction and 

move to history. 

2. Turn-in is unserviceable reparable, close both issue and turn-in 

transaction and move to history. 

3. Turn-in is unserviceable condemned, close both issue and turn-in 

transaction and move to history 

If no match: 

1. Turn-in is serviceable, post to tracking and start DDP clock. 

2. Turn in is unserviceable reparable, post to tracking and start DDP 

clock. 

3. Turn-in is unserviceable condemned, close transaction and move to 

history. 

II EPIP 2.5 

If a turn-in cannot be matched to an issue within the DDP: 

1. Move turn-in transaction to history. 

2. Provide AMC a list of candidate turn-in transactions for credit 

reversal. 

3. AMC will use the list to reverse credit as appropriate. 

II EPBR 3 The LIW and FCM are the reporting activities for One-for-one Credit 

information. 

II EPIP 3.1 LIW and FCM will report One-for-one Credit information. 

II EPBR 4 This process will track recoverable items with a recoverability code 

(RC) of A, D, F, H, L, and K. 

II EPIP 4.1 Tracking for recoverable items applies to all Army SARSS customers. 

II EPIP 4.2 

The process attempts to match a customer turn-in of a serviceable or 

unserviceable item against the oldest issue: 

1. If a match within Delta Delay Period, move to history 

2. If no match within Delta Delay Period, move to history 
Enclosure 2 - Army Exchange Pricing Business Rules 

4 Enclosure 2 to ADC 274 Attachment 

Phase I: Stand-alone Tracking (SAT)

EPIP Description 

II EPIP 4.3 LIW and FCM will report Recoverable Item tracking. 

Phase III: Exchange Pricing 

EPBRs & EPIPs Description 

III EPBR 1 The process will turn “on” EP financial output transactions for Army 

EP customers. 

III EPIP 1.1 AMC will establish a Standard Price (SP), Exchange Price (EP), Serviceable 

Exchange Price Return (SEPR), and Delta for EP items 

III EPIP 1.2 An Army EP customer will be charged the exchange price when 

requisitioning an EP item. 

III EPIP 1.3 There is no unserviceable credit for Army EP customers. 

III EPIP 1.4 NSN-by-NSN Credit policy applies only to serviceable returns that are not 

EP. 

III EPIP 1.5 

If a serviceable turn-in is made against an EP item, which matches an issue 

within the DDP, the customer will be credited with Serviceable Exchange 

Price Return (SEPR) upon receipt of positive trigger from tracking. 

III EPIP 1.6 

An Army EP customer will be billed (on original issue document number) 

for the Delta (SP-EP) for EP items when a repairable carcass is not returned 

within the DDP or when a condemned carcass is matched against an issue. 

III EPIP 1.7 The Delta Bill will be applied to the FY of the original Document Number 

and suffix as an obligation adjustment. 

III EPIP 1.8 The process will accommodate catalog changes from EP to SP and from SP 

to EP. 

III EPIP 1.9 All financial transactions processed after the effective date of a catalog 

change from EP to SP and SP to EP will be at the new value. 

III EPIP 1.10 

An Army EP customer will receive purchase price for Quality Initial Failure 

(QIF) and up to purchase price for Quality Deficiency Report (QDR) IAW 

current policy. 

III EPIP 1.11 

Those Supply Support Activities (SSA), which have been approved by DA 

G-4 to remain in an O&M environment, will be billed Standard Price for all

items. They will receive serviceable credit (Stock Number by Stock 

Number) for serviceable turn-ins, but will receive no credit for unserviceable 

turn-ins. 

III EPIP 1.12 Non-Army EP customers will be billed SP and issued credit upon return of a 

carcass IAW JSR 700-99. 
Enclosure 2 - Army Exchange Pricing Business Rules 

5 Enclosure 2 to ADC 274 Attachment 

Phase I: Stand-alone Tracking (SAT)

EPIP Description 

III EPIP 1.13 

The process attempts to match a customer turn-in against the oldest issue or 

issue against oldest turn-in within the DDP: 

 1. If a match and Army SARSS customer is an Army EP customer: 

 a. Turn-in is serviceable; generate a trigger to issue SEPR. 

 b. Turn-in is unserviceable reparable; close both issue and turn-in move 

to history. 

 c. Turn-in is unserviceable condemned; generate Delta Bill trigger. 

 2. If no match for a turn-in and Army SARSS customer is an Army EP 

customer: 

 a. Turn-in is serviceable; generate a trigger to issue SEPR, post to 

tracking and start DDP clock. 

 b. Turn-in is unserviceable reparable or condemned, post to tracking and 

start DDP clock. 

III EPIP 1.14 

When an issue transaction for an Army EP customer is not matched against a 

turn-in within the DDP, the tracking system will close the transaction and 

post to history then generate a Delta Bill trigger transaction and pass it to 

LMP/CCSS, which will generate and pass the appropriate financial 

transactions to financial CCSS/LMP. 

III EPIP 1.15 

If a serviceable turn-in cannot be matched within the DDP: 

1. Move turn-in transaction to history. 

2. Provide AMC a list of candidate turn-in transactions for credit 

reversal. 

3. AMC will use the list to reverse SEPR as appropriate

III EPBR 2 Arbitration procedures will be developed for resolution of EP 

transactions. 

III EPIP 2.1 Each ACOM/ASCC/DRU will establish a discrepancy validation process 

with AMC Representation. 

III EPIP 2.2 

ASA FM&C and HQDA G4 will create a periodic panel to act as resolution 

authority and set a standard timeframe for resolution of unresolved 

discrepancies. 

III EPIP 2.3 AMC will determine process and procedures for reversal of charges. 

III EPBR 3 

Year-end processes must accommodate EP transactions across fiscal 

years without adverse effect on appropriations or mission (i.e. by 

increasing financial workload at installation and wholesale levels, 

including any automation systems).

III EPBR 4 

Conversion process will accommodate transition to the new environment 

by providing linkage among the fielding schedule, required catalog 

changes, systems changes and customer funding. 

III EPIP 4.1 Active/open transactions generated in the pre-conversion environment will 

continue to function in the new EP environment. 

III EPIP 4.2 Conversion process must address National Level backorders prior to EP 

Implementation when an A5_ and D6_ produced under EP logic. 

III EPIP 4.3 

A requisition on backorder at conversion, when issued, will be billed the EP 

value. The Issue will post in tracking and the customer will receive a Delta 

bill if a Turn-in is not processed within the set number of Delta Days. 
Enclosure 2 - Army Exchange Pricing Business Rules 

6 Enclosure 2 to ADC 274 Attachment 

Phase I: Stand-alone Tracking (SAT)

EPIP Description 

III EPIP 4.4 

Cataloged O&M items will be capitalized in accordance with paragraph F.1 

of chapter 55, volume 11B of the DOD Financial Management Regulation 

(FMR) (i.e., similar to SSF MS3 conversions). 

III EPIP 4.5 

Locally assigned Stock Numbers, part numbers, Management Control 

Numbers, and part numbers not in FEDLOG will be O&M funded normal 

inventory. SOS = LPC. 

III EPBR 5 Nationally funded maintenance programs supported by SARSS will be 

Army EP customers and follow all Business Rule requirements. 

III EPBR 6 Procedures will be developed to address Exchange Pricing under 

contingency operations. 

III EPIP 6.1 Changes to EP customers under contingency operations will be approved by 

Department of the Army. 

III EPIP 6.2 

In support of Department of the Army contingency operations, systems 

architecture will support the capability to charge standard price and grant no 

credit, serviceable or unserviceable, for a Turn-in.